Washington has spent decades building its relationship with Iraqi Kurdistan. Kurdish fighters stood alongside American forces against ISIS. The Peshmerga became a key Western security partner, and Erbil emerged as an important diplomatic and commercial centre in northern Iraq.
That position is now under threat. Masrour Barzani, the Kurdistan Region’s Prime Minister, has a great deal to answer for. His confrontation with the Patriotic Union of Kurdistan (PUK) has pushed the region towards a political split that could undo years of work to build unified institutions.
While the two largest Kurdish parties fight over government posts and political control, Iran has more room to exert pressure and China continues to expand its economic position in Iraq.
For the United States, this is a strategic problem. Washington is trying to maintain its influence in Iraq while confronting Iranian power and competing with China. Yet one of its longstanding regional partners is becoming increasingly divided.
A Partnership Coming Apart
Masrour Barzani has been Prime Minister since 2019. He inherited deep divisions between the Kurdistan Democratic Party (KDP) and PUK, including separate political networks and security structures. But he has had seven years to address them. Instead, his relationship with the PUK has deteriorated to the point where the region is discussing the possibility of two separate administrations.
The October 2024 elections offered an opportunity for compromise. The KDP won 39 seats, making it the largest party but falling short of a majority. The PUK won 23 seats, while the New Generation Movement secured 15.
The PUK and New Generation subsequently formed a joint parliamentary bloc with 38 seats, just one behind the KDP. Barzani’s party had the strongest individual result, but could not govern indefinitely without an agreement with its rivals.
More than two years later, no new government had been formed. On November 4, the KDP pushed ahead with a parliamentary session despite a boycott by the PUK and New Generation. Fifty-two lawmakers attended, enough to meet the quorum.
Six lawmakers attended despite being elected on PUK and New Generation lists. The PUK subsequently announced its withdrawal from government and threatened to establish parallel leadership if the KDP proceeded with unilateral appointments.
The PUK has its own responsibility for this escalation. But Barzani is the Prime Minister. He cannot pursue a confrontational political strategy for years and then distance himself from the consequences. The region’s institutions risk being divided along the same party lines that have weakened Kurdish politics for decades.
Tehran’s Opening
Iran is particularly well placed to exploit this situation. Tehran has longstanding ties with the PUK and significant influence across Iraqi politics. Its relationship with Kurdish political actors dates back decades, including the Kurdish civil war of the 1990s.
A divided Kurdistan gives Iran more opportunities to deal with political factions separately rather than face a united regional government.
There is a more immediate security threat. Iran has repeatedly attacked Iranian Kurdish opposition groups based in Iraqi Kurdistan, arguing that they threaten its national security. On November 4, drones struck opposition targets in Sulaimani and east Erbil. The Iranian Kurdish opposition group blamed Iran’s Revolutionary Guards for the attack.
The Kurdistan Region needs united political and security leadership to manage these threats. Instead, Barzani and the PUK are moving further apart. If they cannot agree on basic questions of governance, their ability to coordinate security policy and resist outside interference will suffer.
Iran does not need to take control of Erbil to benefit. A Kurdish government that cannot speak with one voice is already a weaker obstacle to Tehran’s ambitions.
China Gains Ground
China, meanwhile, is steadily expanding its economic position in Iraq. Its influence is visible field by field, contract by contract.
In January 2024, PetroChina took over as operator of the giant West Qurna-1 oilfield after ExxonMobil exited, becoming the field’s largest shareholder with a 32.7 per cent stake. At the time, the field had a reported production capacity of 500,000 barrels per day. The handover marked a significant shift in the operation of one of Iraq’s major oil assets.
Chinese company Geo-Jade Petroleum also pledged to invest $848 million. A consortium led by the company agreed to invest in the South Basra integrated project, which includes developing the Tuba oilfield and building a 200,000-barrel-per-day refinery.
These are substantial commercial commitments, giving Chinese companies a growing role in the infrastructure and energy revenues on which Iraq depends.
Kurdistan’s relationship with Baghdad is already difficult, particularly over oil exports, federal budget transfers and control of revenues. A divided Kurdish leadership has less bargaining power in those disputes and less ability to defend the region’s economic interests.
China’s direct presence in Kurdistan remains more limited than in federal Iraq. Its investments do not establish that Beijing wants a weaker Erbil. But as Chinese companies deepen their partnerships with Baghdad, Kurdish leaders absorbed in internal disputes risk losing influence over decisions shaping the country’s economic future.
Beijing does not need to engineer the Kurdish crisis to find opportunities in the weakness it creates.
America’s Investment at Risk
The contrast with America’s position is striking. Washington has invested heavily in the Peshmerga and supported efforts to bring Kurdish forces under a unified command.
In September 2026, the Kurdistan Region’s Ministry of Peshmerga Affairs announced the completion of a major unification and reorganisation process. Yet political divisions between the KDP and PUK remain a serious obstacle to making that unity durable.
The timing is especially sensitive. The US-led coalition’s military mission in Iraq ended on September 30, with coalition forces withdrawing from Erbil. Washington’s security ties with Iraqi partners, including the Peshmerga, continue. But the transition places greater responsibility on local institutions.
A divided Kurdish leadership makes that task considerably harder.
The United States should not have to watch years of security cooperation undermined by a political confrontation in Erbil. The Peshmerga were an important partner in defeating ISIS. Kurdistan remains strategically located between Iran, Turkey and the rest of Iraq. Its stability matters to American interests, not simply to Kurdish politics.
The Kurdistan Region has faced repeated drone and missile attacks, including strikes on energy infrastructure. On November 8, a suspected drone attack on the Khor Mor gas field halted production and disrupted electricity generation across the region.
These threats require coordination between political leaders, security forces and international partners. Political fragmentation is the last thing Kurdistan needs.
The 2017 independence referendum should have taught Kurdish leaders a lasting lesson. The loss of Kirkuk demonstrated how quickly Kurdish political gains could be reversed when internal unity broke down and international support was absent.
Today, the danger is not necessarily another sudden territorial defeat. It is the gradual weakening of autonomy as Baghdad gains leverage, Iran exploits division and China deepens its economic position.
Barzani cannot resolve every rivalry or control every outside power. But as Prime Minister, he has a responsibility to pursue a political settlement that protects Kurdistan’s shared institutions. Allowing them to fracture would put both Kurdish autonomy and a longstanding American partnership at risk.
